Catalog design development service and catlog master bill tds rate

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catalog design development service and catlog master bill tds rate
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For payments related to catalog design and development services, the applicable Tax Deducted at Source (TDS) rate under the Income Tax Act depends on how the service is classified:

Applicable TDS Rate

  • Fees for Technical Services (FTS): If the catalog design is considered a "technical service" (which often includes services involving technical expertise or software/website development), the TDS rate is 2%.

  • Professional Services: If the design service is classified as a "professional service" (e.g., advertising, graphic design consultancy, or other notified professions under Section 44AA), the TDS rate is 10%.

Recommendation: In practice, "design and development" services are frequently treated as Technical Services if they involve software or complex digital development, or as Professional Services (advertising/consultancy). You should consult your tax advisor or verify the specific nature of the work contract to determine which classification applies to your case.

Key Provisions (Section 194J)

  • Threshold Limit: TDS is applicable only if the aggregate amount paid or credited to the payee exceeds ₹50,000 in a financial year.

  • Deductor Liability: TDS must be deducted by any person (other than an individual or HUF who is not subject to a tax audit) making these payments to a resident.

  • Non-Furnishing of PAN: If the payee fails to provide their Permanent Account Number (PAN), the TDS rate increases to 20%.

  • Timing: TDS is to be deducted at the time of credit to the payee's account or at the time of payment, whichever is earlier.


Summary: For catalog design and development, the TDS rate is typically 2% if classified as a technical service or 10% if classified as a professional service under Section 194J. The deduction is mandatory if total payments to the provider exceed ₹50,000 in a financial year.

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